In a move to tap the orders from Japanese automajors in India, Coimbatore-based auto components manufacturer Pricol Ltd is planning to rope in a foreign partner. The company also said that it would transfer a technology meant for Japanese cars to a subsidiary.
In an explanatory note to the company’s shareholders, Pricol said the major portion of company’s business is in the segment of instruments for all types of vehicles. The trend of instruments is moving more towards electronics, integrated with information flow within the vehicle and having advanced and attractive displays.
The company requires a close association with global players in vehicle instrument manufacturing. The market share of Japanese vehicle makers in India is expected to continue to be over 50 per cent. To maintain and increase the company’s share of business with Japanese OEMs in India, the company needs to partner a global vehicle instrument manufacturing company having a close association with Japanese vehicle manufacturers.
In this connection, the company has decided to transfer Denso Technology instrument businesses for Japanese cars made in India to a wholly-owned subsidiary Pricol Components Ltd and thereafter form a JV with a global vehicle instrument supplier. This would help add new products to the JV for supply to Japanese car markers in India, said in the explanatory note. The Denso Technology is related to the four-wheeler personal passenger vehicles situated at the company’s Coimbatore and Gurgaon facilities.
The net book value of the undertaking to be transferred on a slump basis is estimated to be around Rs 50 crore. The planned effective date for the transaction would be March 2013.
For 2012-13, the company has projected revenues of around Rs 70 crore from sale of personal passenger vehicle instrument business to Maruti Suzuki Ltd, Toyota Kirloskar Motor Pvt Ltd and Magyar Suzuki Corporation.